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Samsung Electronics flagged a nearly 60 percent rise in third-quarter operating profits Thursday, largely driven by strong smartphone sales boosted by US sanctions against its rival Huawei.
The South Korean tech giant said in an earnings estimate that it expected operating profit to be 12.3 trillion won ($10.6 billion) for July to September, up from 7.8 trillion won in the same period last year.
The prediction was in line with analyst forecasts.
Samsung was projected to post around 10.3 trillion won ($8.9 billion) in third-quarter operating profit, according to market researcher FnGuide.
Samsung Electronics is crucial to South Korea’s economic health. It is the flagship subsidiary of the giant Samsung group, by far the largest of the family-controlled conglomerates known as chaebols that dominate business in the world’s 12th-largest economy.
Its overall turnover is equivalent to a fifth of the country’s gross domestic product.
Analysts say the firm’s strong third-quarter performance was largely led by its mobile business, which enjoyed a boost from US sanctions on Huawei.
A Washington ban on foreign companies providing Huawei with US-origin technology came into effect on September 15, cutting off essential supplies of semiconductors and software needed for making smartphones and 5G equipment.
Kang Min-soo, an analyst at Counterpoint Research, said US sanctions against Huawei were becoming “a big factor” affecting the global smartphone market.
“For Samsung, it will be a good opportunity to increase market share in Europe, where it has been competing with Huawei in various price bands,” he added.
Looking forward, analysts said falling chip prices could put a damper on Samsung’s performance in the final quarter of the year.
Samsung is the world’s biggest manufacturer of memory chips and led the DRAM market with 43.5-percent share
Wireless Computer Speakers Market to See Promising Growth Ahead| JBL (Harman International), Creative, iLive Electronics (DPI), IPEVO
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